The Child Care Protection Under TANF
Jan 01, 1998 | Mark Greenberg
The Child Care Protection Under TANF by Mark H. Greenberg
Introduction In enacting the Temporary Assistance for Needy Families (TANF) Block Grant, Congress altered state responsibilities and protections for families when a family needs child care assistance in order to participate in a work or work-related activity. Under prior law, states had an affirmative responsibility to "guarantee" child care needed for a family member to accept or retain employment or to participate in approved education or training. Under TANF, there is instead a prohibition against a state imposing a grant reduction or termination against a family when the parent cannot participate in a required activity due to lack of needed child care. There are a number of unresolved questions about the nature of the child care protection under TANF. However, some important guidance has emerged from proposed regulations issued by the federal Department of Health and Human Services. The guidance emerges from reading together two sets of proposed regulations: one set concerns the Child Care and Development Fund (62 Fed. Reg. 39610, July 23, 1997); more recently, a set of proposed TANF regulations were issued (62 Fed. Reg. 62124, November 20, 1998). While the comment period on the proposed CCDF regulations has closed, it is possible to submit comments on the proposed TANF regulations until February 18, 1998.(1) This document answers a set of questions concerning the child care protection, drawing on the TANF statute and the framework for interpretation provided by the proposed regulations. It begins by briefly reviewing prior law and the relevant language of the federal TANF statute, and then discusses a set of questions about who the protection applies to, its relation to work requirements and time limits, and the procedures that a state must have in place to avoid or minimize the risk of a penalty for failure to comply with the protection. Background: Prior Law The Family Support Act of 1988 had enacted a "child care guarantee" applicable to the Aid to Families with Dependent Children (AFDC) Program. The child care guarantee provided that states had a responsibility to "guarantee" child care needed for a family receiving assistance to accept or retain employment, or to participate in the JOBS Program or another approved education or training activities; states also had a responsibility to provide up to one year of transitional child care assistance for qualifying families who left AFDC due to employment. The child care guarantee extended to children under age 13, and in limited circumstances, to children ages 13 and over. Under the AFDC statute, a state imposing work-related requirements on families could not sanction (reduce assistance to) a family if the noncomplying individual had good cause for the failure to comply, and the lack of needed child care was among the reasons that constituted good cause. The Child Care Protection Under the TANF Statute
(2) EXCEPTION.-Notwithstanding paragraph (1) [i.e., the general requirement to reduce or terminate assistance when an individual refuses to engage in work], a State may not reduce or terminate assistance under the State program funded under this part based on a refusal of an individual to work if the individual is a single custodial parent caring for a child who has not attained 6 years of age, and the individual proves that the individual has a demonstrated inability (as determined by the State) to obtain needed child care, for 1 or more of the following reasons: (A) Unavailability of appropriate child care within a reasonable distance from the individual's home or work site. (B) Unavailability or unsuitability of informal child care by a relative or under other arrangements. (C) Unavailability of appropriate and affordable formal child care arrangements. Under the TANF statute, the federal government lacks the authority to enforce requirements of the law except where that authority is expressly granted by statute. Congress provided for federal enforcement of the child care protection through the enactment of a provision stating that a state could be penalized in an amount up to 5% of its block grant for failure to comply with the child care protection.(2) The Scope and Meaning of the Child Care Protection: Questions and Answers
The child care protection is a protection against sanctions (i.e., the reduction or termination of assistance). The provision does not impose any duty on states to provide needed child care assistance, and does not make a family exempt from program requirements if needed child care is unavailable. It is only a restriction on the authority of states to reduce or terminate assistance based on noncompliance with work requirements when needed child care is unavailable.
Third, there is a separate TANF requirement stating that a state must require individuals receiving assistance to be engaged in community service after two months of receiving assistance, unless the state opts out. As with the twenty-four month requirement, this requirement is subject to the child care protection, and a state electing to apply the requirement is free to set its own definition of community service and its own hourly thresholds (if any); a state is also free to elect to opt out of this requirement.
By its terms, the child care protection does not affect the running of TANF time limits. However, if a state wishes to make families exempt from TANF time limits when needed child care is unavailable, the state can elect to do so by using "segregated" state funding to provide assistance within the state's TANF Program.
If a family is receiving federally-funded TANF assistance while needed child care is unavailable, the federal time-limit clock will continue to run. Even if, for example, the state elects to exempt single parents of children under age one from TANF work and participation requirements, the TANF time clock will still be running during their period of exemption so long as they are receiving federally-funded TANF assistance.
However, if a state does not want time limits to run when needed child care is unavailable, an alternative is readily available: the state can choose to fund the assistance to such families with "segregated" state funds, i.e., state funds in the TANF Program that are not commingled with the federal TANF funds. HHS has expressly recognized that in structuring its TANF Program, a state can choose whether to "commingle" federal and state funds or to segregate state from federal funds for at least some cases. If federal and state funds are commingled, then all families are receiving federally-funded assistance, and each month of assistance counts against the federal TANF time limit. On the other hand, in each month in which a family is assisted with segregated state funds, the federal time limit clock does not run. Thus, it is possible to prevent the federal time limit clock from running when needed child care is unavailable, but unless the state makes such an arrangement, the federal clock will run.(3)
In administering the Child Care and Development Fund in the state, every state has a CCDF lead agency, which may or may not be different from the TANF agency. In proposed CCDF regulations, HHS provides that CCDF lead agencies shall inform parents about the TANF child care protection, including the procedures and criteria or definitions used by the TANF agency to determine if a parent has a demonstrated inability to obtain care, and the fact that the time limit clock will continue to run during the period when needed child care is unavailable. The proposed regulation also provides that a state's biennial CCDF plan must include the definitions or criteria used by the TANF agency to implement the child care protection. [Proposed] 45 C.F.R. §98.33, 62 Fed. Reg. 39610, 39646 (July 23, 1997).(4)
Under the TANF statute, the state may not reduce or terminate assistance if the individual proves that the individual has a demonstrated inability (as determined by the State) to obtain needed child care, for 1 or more of the following reasons: (A) Unavailability of appropriate child care within a reasonable distance from the individual's home or work site. (B) Unavailability or unsuitability of informal child care by a relative or under other arrangements. (C) Unavailability of appropriate and affordable formal child care arrangements.
None of the key terms are defined or clarified in the TANF statute. To date, HHS has not sought to define the terms. Rather, in proposed regulations, HHS would provide that the state must have criteria for determining when the individual has demonstrated that she cannot find child care and that the criteria must:
Proposed TANF rules provide important guidance for procedures states must have in place to minimize the risk of being penalized for failure to comply with the child care protection.(6) The TANF statute provides that if HHS determines that the state has not complied with the child care protection, the state will be penalized up to 5% of its block grant, with the amount of the penalty based on the degree of noncompliance. Proposed rules (reflecting the statutory requirements) also provide that the penalty will not be imposed if HHS determines that the state had reasonable cause for the violation or if the state corrects the violation through a corrective compliance process; moreover, HHS can choose to reduce the amount of the penalty even if the violation is not fully cured through the corrective compliance process.
The TANF statute allows for HHS to exercise discretion in deciding whether to impose the maximum 5% penalty or a lesser amount. HHS indicates in the proposed rules that it intends to impose the maximum penalty if:
HHS further indicates that it would impose a penalty less than the maximum if the state demonstrates that the violations were isolated or that they affected a minimal number of families.(7)
The preamble to the proposed regulations provides further guidance as to the circumstances under which HHS would conclude that there had been a violation of the child care protection, explaining that HHS would give consideration to:
62 Fed. Reg. 62164. HHS further explains:
For example, a State that uses the services of a child care resource and referral (CCR&R) office might accept a statement from that office noting the unavailability of appropriate or affordable child care. Or, if the refusal to work is due to difficulty in arranging transportation, the State could refer to bus and rail rates and schedules to determine if the appropriateness and/or reasonable distance criteria had been met.
We are not specifying the process or procedures that States should develop, or the documents, if any, States should require. However, we suggest that if States plan to require documents, they select ones that are readily available to families. We recommend that the process or procedures be simple and straight forward. In addition, we recommend frequent contact with parents since the penalty exception does not stay the time limits and there may be fluctuations in the availability of child care services.
62 Fed. Reg. 62164.
If there is a violation of the child care protection, other provisions of the proposed regulations suggest that HHS intends to read the "reasonable cause" exception narrowly. For the child care protection and another set of penalties, HHS indicates that "reasonable cause" would be limited to the following "general factors:"
[Proposed] 45 C.F.R. §272.5. Thus, in a number of instances, only "corrective compliance" would likely be available as a means to avoid the penalty. As to what would constitute "corrective compliance," the preamble explains:
The steps a State takes to correct or discontinue a violation may vary. . . . Where a State has reduced or denied assistance improperly to a single custodial parent who could not find child care for a child under six, correcting the violation may require that the State reimburse a parent retroactively for the assistance that was improperly denied. The State's corrective compliance plan would also have to describe the steps to be taken to prevent such problems in the future.
62 Fed. Reg. 62149. As a practical matter, many states are likely to not wish to be in a situation where they face the risk of penalties, and must assert reasonable cause or develop a corrective compliance plan. Under the proposed rules, the way to minimize the risk of a potential penalty is to review the preamble guidance (above) regarding the factors that HHS would consider in determining whether a violation has occurred, and ensure that statewide criteria and procedures are in place consistent with the terms of the statute and the HHS guidance. Conclusion At this point, there are still many unresolved questions about the scope and operation of the child care protection. The proposed HHS regulations are not binding, but they do provide important guidance, suggesting that, at minimum, a state wishing to avoid a penalty or minimize the size of any penalty needs to:
Finally, it should be emphasized that the child care protection is a floor, not a ceiling on state conduct. Prior to TANF, all states were required to provide far more protections for families needing child care assistance in order to participate in work and training programs. Nothing in TANF prevents a state from establishing or maintaining more substantial protections than those required by federal law.
Appendix
While the proposed rules provide significant guidance in interpreting the chid care protection, there are still a set of unresolved concerns that could be addressed in final regulations. Among those concerns:
To ensure that the child care protection operates effectively, CLASP has recommended that final TANF regulations:
In addition:
Readers should keep in mind that comments on the TANF child care protection regulations (and other TANF regulations) may be submitted to HHS through February 18, 1998. 1. Comments may be mailed or hand-delivered to the Administration for Children and Families, Office of Family Assistance, 5th Floor East, 370 L'Enfant Promenade, SW, Washington, DC 20447, or may be transmitted electronically by accessing the ACF Welfare Reform Home Page at http://www.acf.dhhs.gov/news/welfare. For a discussion of the proposed TANF regulations pertaining to the child care protection, see, Appendix, Concerns Presented by the Proposed TANF Child Care Protection Regulations. 2. Section 409(a)(11) of the TANF statute provides: FAILURE TO MAINTAIN ASSISTANCE TO ADULT SINGLE CUSTODIAL PARENT WHO CANNOT OBTAIN CHILD CARE FOR CHILD UNDER AGE 6.- "(A) IN GENERAL.-If the Secretary determines that a State to which a grant is made under section 403 for a fiscal year has violated section 407(e)(2) during the fiscal year, the Secretary shall reduce the grant payable to the State under section 403(a)(1) for the immediately succeeding fiscal year by an amount equal to not more than 5 percent of the State family assistance grant. "(B) PENALTY BASED ON SEVERITY OF FAILURE.-The Secretary shall impose reductions under subparagraph (A) with respect to a fiscal year based on the degree of noncompliance. 3. For a more detailed description of the possibilities and considerations in usage of segregated state funding, see Savner and Greenberg, The New Framework: Alternative State Funding Choices Under TANF (CLASP, March 1997). Note that in recent proposed federal regulations, HHS has proposed to restrict the relief from penalties available under certain circumstances to states that elect to use state maintenance of effort funding in order to operate separate state programs outside of TANF; however, the proposed regulations would not take a similarly restrictive approach to a state that uses segregated funding within TANF. 4. The proposed regulatory language says that CCDF lead agencies shall: " (b) Inform parents about the requirement at section 407(e)(2) of the Social Security Act that the TANF agency make an exception to the individual penalties associated with the work requirement for any single custodial parent who has a demonstrated inability to obtain needed child care for a child under six years of age. The information provided shall include: (1) The procedures the TANF agency uses to determine if the parent has a demonstrated inability to obtain needed child care; (2) The criteria or definitions applied by the TANF agency to determine the whether the parent has a demonstrated inability to obtain needed child care, including: (I) "Appropriate child care"; (ii) "Reasonable distance"; (iii) "Unsuitability of informal child care"; (iv) "Affordable child care arrangements"; (3) The clarification that the time during which an eligible parent receives the exception referred to in paragraph (b) will count toward the time limit on benefits required at section 408(a)(7) of the Social Security Act. (c) Include in the biennial plan the definitions or criteria the TANF agency uses in implementing the exception to the work requirement specified in paragraph (b). " 5. The proposed regulatory language reads as follows: §271.15 Can a family be penalized if a parent refuses to work because (s)he cannot find child care? (a) If the individual is a single custodial parent caring for a child under age six, the State may not reduce or terminate assistance for the parent's refusal to engage in required work if (s)he demonstrates an inability to obtain needed child care for one or more of the following reasons: (1) Appropriate child care within a reasonable distance from the home or work site is unavailable; (2) Informal child care by a relative or under other arrangements is unavailable or unsuitable; or (3) Appropriate and affordable formal child care arrangements are unavailable. (b)(1) The State will determine when the individual has demonstrated that (s)he cannot find child care, in accordance with criteria established by the State. (2) These criteria must: (i) Address the procedures that the State uses to determine if the parent has a demonstrated inability to obtain needed child care; (ii) Include definitions of the terms "appropriate child care," reasonable distance," "unsuitability of informal care," and "affordable child care arrangements"; and (iii) Be submitted to us [i.e., HHS]. 6. In publishing the proposed TANF rules, HHS expressly notes that while the regulations are in proposed form, they are not binding on states. Instead, HHS explains: "We will judge State behavior and actions that occur prior to (effective date of final rules) only against a reasonable interpretation of the statutory provision in title IV-A of the Act." [Proposed] 45 C.F.R. 270.40. In other words, even if a state takes an approach different from that of the proposed regulations, the state should not be penalized if the state can demonstrate that its approach reflected a reasonable interpretation of the statutory language. At the same time, a state should keep in mind that there may be disputes about what is a reasonable interpretation of the statutory language, and that a state operating its program in conformity with the proposed regulations will not need to risk losing such a dispute. 7. The proposed regulatory language reads as follows: §274.20 What happens if a State sanctions a single parent of a child under six who cannot get needed child care? (a) If we determine that a State has not complied with the requirements of §271.15 of this chapter, we will reduce the SFAG [State Family Assistance Grant] payable to the State by no more than five percent for the immediately succeeding fiscal year unless the State demonstrates to our satisfaction that it had reasonable cause or we approve a corrective action plan pursuant to §§ 272.5 and 272.6 of this chapter. (b) We will impose the maximum penalty if: (1) The State does not have a statewide process in place that enables families to demonstrate that they have been unable to obtain child care; or (2) There is a pattern of substantiated complaints from parents or organizations verifying that a State has reduced or terminated assistance in violation of this requirement. (c) We will impose a reduced penalty if the State demonstrates that the violations were isolated or that they affected a minimal number of families. 8. HHS also indicates that a reasonable cause exception would not be available if HHS detects that, in using the state's TANF maintenance of effort funds, there have been a significant pattern of diversion of families to a separate state program that achieves the effect of avoiding the work participation rates. [Proposed] §272.5(c). For a discussion of this issue, see CLASP comments on "Child Care and Development Fund NPRM, 62 Fed. Reg. 39610 (July 23, 1997)" September 22, 1997.
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